CX is key to insurers in the digital world. Source: Shutterstock

CX is key to insurers in the digital world. Source: Shutterstock

In the digital world, insurance claims are an opportunity

INSURANCE companies have traditionally seen assessing and processing claims as a cost. Obviously, that leads to poor customer experiences (CX), which, in the digital world, are bad for business.

In many parts of the world today, surveys suggest that customers don’t feel confident that their insurer will treat them fairly in the event of a claim.

Obviously, this causes many individuals to give insurance a miss in regions where regulations don’t force them to get insured, or go for cheaper alternatives with lower premiums because they don’t believe they’ll get any value in exchange.

For the insurance industry, this is a bad thing — one that it has been fighting for decades. In recent times, with online reviews empowering customers even further, insurers know things need to change.

Forrester VP and Research Director Oliwia Berdak recently talked about this issue in a company blog post.

She highlighted that insurers have several alternatives these days — from mature technologies such as claims management systems to emerging ones such as cognitive automation and virtual assistants — to fulfill the promise given to customers while protecting their bottom-line.

“Based on my client interactions, I know that many insurers are struggling with claims — a complex process with many moving parts and stakeholders that is often just seen as a cost. That’s a missed opportunity,” said Berdak.

Claims open up a whole new world of opportunities

Insurance companies know that customers should increase their cover as they grow in life.

A new addition to the family and acquiring a new house or a car, for example, are all great triggers to take on additional insurance cover.

However, agents have traditionally found it hard to open up a dialogue with customers and provide them with advice and guidance.

Customers tend to only engage with an insurance agent once a year when paying the premium and given the lack of trust and confidence, avoid sharing details of their growth. To be fair, these annual interactions are being replaced by convenient digital premium payments, taking away that single opportunity as well.

Claims, however, if handled well, can present a whole new world of opportunities for insurance companies and their agents — and significantly boost CX.

Claims provide an opportunity for insurers to get in touch with customers and understand their needs. In the digital world, it allows them to collect more data on customers and provide them with better products and services in addition to advising them to increase their policy cover (if needed).

Modern-day insurers and insurtech startups are doing this quite effectively, making insurance a painless process. If traditional insurers don’t catch up, they risk losing business to other players in the market.